Finding Text
Criteria: According to 2 CFR §200.214, nonfederal entities other than states must follow the suspension
and debarment standards set out at 2 CFR Part 180, which restrict making Federal awards, subawards,
and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or
participating in Federal awards.
Condition: During our audit of the Organization's federal awards, we identified a deficiency in the
grantee’s procurement, suspension, and debarment procedures related to suspension and debarment for
4 of 4 subcontractors we reviewed. Specifically, the grantee did not verify that subcontractors were not
excluded or disqualified before entering into transactions expected to exceed $25,000 in accordance with
the Uniform Guidance.
Cause: The Organization did not have adequate policies and procedures or internal controls in place to
ensure compliance with the procurement, suspension, and debarment requirements.
Effect: The Organization may be paying subcontractors that are suspended or debarred, which would be
unallowable costs. However, none of the 4 subcontractors were suspended or debarred as of the date
audit procedures were performed.
Recommendation: We recommend that the Organization implement policies and procedures to ensure
that all subcontractors and subrecipients of covered transactions are properly verified before entering into
transactions, and that this be documented as a control each time it is performed.
Views of Responsible Officials: Management agrees with the finding and procedures have been
implemented to address the related issues.